An East Hanover church pastor has been vindicated of sexual abuse allegations by the Vatican, which upheld his exoneration following a church trial by the Roman Catholic Diocese of Paterson, according to a statement by the diocese.

Monsignor William McCarthy, formerly of St. Rose of Lima Church in East Hanover, was suspended from the ministry six years ago following claims that he abused two girls 23 years ago.

He now "is a priest in good standing and is free to exercise his priestly ministry as a retired priest," according to a statement released Wednesday to priests and deacons by Monsignor James T. Mahoney.

"Six years ago, allegations were made against Monsignor William McCarthy. A Church Tribunal, composed of canon lawyers from outside the diocese, concluded that it was not proven that he was guilty of the charge alleged against him. The Holy See has determined that the case is closed," Mahoney stated. "During this very difficult time in his life, Monsignor McCarthy has been totally cooperative, faithful to his priesthood, and shown a great love for the church."

McCarthy was relieved. "I haven't touched ground yet. I am vindicated," he said today and noted in a statement that he was devastated by the allegations.

He said he was "unjustly accused of abuse of two sisters around five or six years of age in 1980." He said he had "never been accused of any other improper conduct" during his 40-year career as a priest.

McCarthy, retired in March 2003, just before the allegation became public, and about three months before his planned retirement.

Church trials -- or canonical trials -- differ from secular trials. There are no juries, and usually three canon lawyers serve as judges and decide cases. Canonical trials are closed to the public, and no one is cross-examined. If found guilty, a priest could be laicized -- formally removed from the priesthood -- by the Vatican. ¶

The matter was reviewed by the Morris County Prosecutor's Office, which ultimately turned over a file to the diocese. The prosecutor's investigation found there were allegations of sexual misconduct between 1981 and 1983 involving the two girls, an attorney for the diocese said at the time. ¶

Donald Belsole, an attorney for the women, declined comment yesterday.